1. ' GUL ZARIN KIANI, J.--National Bank District Court Branch, Sahiwal, filed a civil suit for recovery of Rs, 1,86,865.08 against petitioners (defendants) in the Special Court Banking, established under the provisions of Bankihg Companies (Recovery of Loans) Ordinance, 1979. Defendants in the civil suit applied for leave to defend the suit under Order XXXVII, rule 3 of the Code of Civil Procedure, 1908.
2. Learned Special Judge Banking Court, vide order dated 9-10-1982 permitted defendants Nos. 1 and 2 to defend civil proceedings against them conditionally subject to deposit of the entire suit amount in Court. As regards the remaining defendants, they were allowed defence unconditionally.
3. Defendants Nos. 1 and 2, in order to seek variation in terms of order dated 9-10-1982 moved a petition in review jurisdiction under Order XLVII, rule 1, C. P. C. The learned Judge Special Banking Court, vide order dated 18-11-1982 while entertaining review petition for its consideration on merits, extended the time limit for deposit of the amount till the next date of hearing fixed in the civil suit.
4. Order dated 18-11-1982 reads :- "Counsel for the parties present. The defendants Nos. 1 and 2 have not deposited the amount in compliance with the Court orders. Both the defendants filed review applications. I condone the time till next date of hearing for depositing the amount in compliance with my order. They should deposit the cash by the next date of hearing. I will also hear the arguments on review applications on that date of hearing. If the review applications are accepted then they can take back that amount deposited under the order of the Court. To come up on 16-12-1982."
5. ' Order dated 9-10-1982 granting permission of defence subject to cash deposit and order dated 18-11-1982 reproduced in extenso, have been challenged through the present constitutional petition. Meanwhile, civil suit seeking recovery of Rs, 1,86,865.08, in view of the provisions of the amending Ordinance II of 1983, notified in Gazette on and effective from 30-1-1983, had been transferred to the High Court to be adjudicated upon it in its original civil jurisdiction. Effect is that civil suit along with review petitions is before the High Court. In the constitutional petition presented, the Court, vide its order dated 11-12-1982, suspended the operation of the impugned order dated 9- 10-1982 imposing condition of cash deposit of the suit amount till the decision of the review petition.
6. Writ petition is still in motion hearing despite lapse of more than 2 years.
2. Learned counsel for the parties have been heard at length. It was submitted on behalf of the petitioners that the Court in a civil suit regulated by procedure laid down in Order XXXVII, C. P. C., while considering the question of "leave" conditional or unconditional, is obligated to attend to the important question' whether the defence raises a real and substantial issue or even prima facie case and if the answer be in the affirmative, then leave to defend without condition is to be granted to the defendant for it is not the purpose of law that onerous, harsh, and oppressive conditions be laid on the right of defence in the civil suit. Such like oppressive conditions may virtually amount to defeating the right of a defendant to produce requisite defence. Non-deposit of the amount in Court will result in decreeing the civil suit against the defendants. In the case under consideration, defendants had raised certain basic issues touching the very competence and jurisdiction of the Special Court to entertain, hear and adjudicate upon the controversy placed before it. Although the matter lay in the discretion of the Court, yet while exercising its discretion, the Court must take note of all the attendant considerations relevant for exercise of its discretion.
7. Discretion of Court like all other powers must be governed by reason and not caprice. Learned counsel contended that the Court when imposing the onerous condition on his right of defence has acted arbitrarily. Interlocutory order passed on 9-10-1982 though not appealable, yet was amenable to judicial review in constitutional jurisdiction by the High Court. It suffered from serious legal infirmities going to the very root of the jurisdiction of the Special Court. It was also stated that when a question relating to jurisdiction of a ribunal/Court is raised in defence, the Tribunal/Court is bound to take notice of it and decide about its own jurisdiction before taking any further step in the matter. Special Court in disregard of all the pleas raised in written statement passed "leave order" conditional on deposit of the amount claimed in the suit. Reliance was placed upon Messrs Shehzad Ice Factory and 2 others v. Special Judge, Banking-II, Lahore and another (1), Nazim v.
8. Messrs Habib Bank Ltd., Karachi and another (2), Messrs S. M. Ayyub & Co. And others v. National Bank of Pakistan and others (3) and Akhtar Ali Parvez v. Altafur Rehman (4).
9. ' Learned counsel for the respondents, in reply, submitted that the Special Court under Order XXXVII, rule 3(2), C. P. C. Upon an application, seeking permission to defend, in its discretion, on consideration of facts disclosed grants "leave" conditional or unconditional. Order passed under Order XXXVII, rule 3(2) granting leave, is interlocutory in its nature and is not appealable. It only regulates further proceedings in the civil suit and does not put absolute embargo on the right of defendant to lead defence. Defendant has only to deposit the amount and then produce his defence. He also stressed that the interlocutory order unamenable to appeal or other remedy cannot be assailed in constitutional jurisdiction. Resort to extraordinary jurisdiction of the High Court in such like matter where the Legislature in unequivocal language has barred right of appeal, would defeat and deflect the purpose of this special legislation. It was also submitted that the petitioners cannot be permitted to resort to parallel litigation in two distinct forums. Relied on International Food Centre Ltd., Lahore v. United Bank Ltd., Karachi and 2 others (5), Nayyar Manzoor v. National Bank of Pakistan and others (6), Muslim Commercial Bank Ltd. v. Sh. Ljaz Nisar and 2 others (7), General Investment Ltd. v. Dubai Bank Ltd. (8), Messrs Stillman Mahmood Cotton Ginners, Kabirwala and 2 others v. Special Judge, Banking-II and another (9), Ch. Auto Mobile Auto Store and others v. United Bank Ltd. (10), Sh. Abdul Majid v. United Bank Ltd. (11), unreported decisions in Writ Petitions Nos. 12295/80, 204/81, 205/81, 206/81, 3095/82, 2203/80 and a D. B. Judgment in I. C. A.
10. No, 439/80.
11. ' Judgment in Messrs Shehzad Ice Factory and 2 others v. Special Judge Banking-II, Lahore and another, and judgment in Writ Petition No, 574/81 were not followed by a learned Single Judge of this Court in case of Messrs Sullman Mahmood Cotton Ginners, Kabirwala and 2 others v. Special Judge Banking-II and another. In Writ Petition No, 670/81, decided on 25-10-1981, Writ Petition No, 574/81 decided on 18-11-1981, a learned Single Judge of this Court had struck down an interlocutory order passed by Special Judge Banking granting permission of defence subject to deposit of the amount sued as being illegal and without jurisdiction. Ratio of decision reported in Messrs Shehzad Ice Factory and 2 others v. Special Judge Banking-II, Lahore and another, is found in the following observations :- "I am of the considered opinion that if this Court is satisfied that an interlocutory order suffers from infirmities affecting the jurisdiction
(1) PLD 1982 Lah. 92 (2) 1980 CLC 1185
(3) 1983 CLC 2828 (4) PLD 1963 Lah. 390
(5) 1982 CLC 108 (6) 1982 CLC 2416
(7) 1982 CLC 1433 (8) 1982 CLC 2252
(9) PLD 1982 Lah. 353 (10) 1984 SCMR 749
(11) 1984 SCMR 1434 of a Court or Tribunal, then it would be failing in its constitutional duties to refuse to interfere and allow the Court or Tribunal to pass illegal orders under the cover of Special Law because once the Court comes to a conclusion that the Court or Tribunal has exceeded jurisdiction by flouting; the provisions of relevant law, has violated the principles governing the exercise of judicial discretion, acted arbitrarily, passed an illegal and unfair order without applying its mind, it would, then be the duty of this Court while sitting in its constitutional duties to strike down such order regardless of the fact that the interference may defeat the legislative intent i,e, a speedy and efficacious method for the recovery of loans advanced by the Bank."
12. ' Akhtar Ali Parvez v. Altafar Rehman pertains to rent matter. Messrs S. M. Ayyub & Co. And others v.
13. National Bank of Pakistan and others is no doubt a Division Bench judgment. Speaking with immense respects for the views expressed by the learned Judges in the above noted report, it seems that the cases of Fine Textile Mills Ltd., Karachi v. Haji Ulna'. (1), Haji Karim and another v. Zaka Abdullah (2), were not brought to notice of the learned Judges of the Division Bench. In Nazim v.
14. Messrs Habib Bank Ltd., Karachi and another, a decision in revisional jurisdiction Karachi High Court observed that in case of plausible defence, defendant was entitled to unconditional leave. Legal question that arises for decision in the constitutional petition is whether an interlocutory order passed under Order XXXVII, rule 3(2), C. P. C. Granting permission to defend civil suit subject to deposit of the suit amount can be assailed in extraordinary jurisdiction of the High Court when the law specifically barred the remedy of appeal against such order. For proper resolution of this controversy, it is appropriate to refer to the object behind this special legislation. To facilitate, speedy recovery of large loans due to the Banking Companies, a Special enactment known as Banking Companies A (Recovery of Loans) Ordinance XIX of 1979 was enacted by the Legislature.
15. There was a definite purpose and object behind this Special Legislation. It seems to avoid cumbersome time consuming procedure involved in a civil suit instituted by the creditor Banking Companies which went to the advantage of the debtors, the Legislature in its wisdom came to the rescue of the Banking Companies and enacted a law which safeguarded the interests of the parties. It was with this object in view that a Special Court regulated by its own procedure was brought into being under the Special Legislation. Order XXXVII, C. P. C. Was made applicable to proceedings before the Special Court. Leave to defend the civil suit could be granted by the Court on an application by the defendant. Court in its discretion can, while granting permission, impose conditions on right of defence. Obviously, discretion is to be exercised after considering relevant material. Imposition of condition regulating the defendants' right to defend the suit is within the jurisdiction of the Court. Final orders passed by the Special Court are made appealable under section 12 of the Ordinance. Absolute bar exists against right to appeal against an interlocutory order. There is no provision for revision or any other remedy against such an interim order. Obvious intention is that only final orders passed by the Special Court could be brought under challenge in the mode and manner provided in section 12 of the Ordinance. This amendment fits in with the policy of the Special Legislation. In International Food Centre (1)PLD 1963 SC 163 (2)1973 SCMR 100 Ltd., Lahore v. United Bank Ltd., Karachi and 2 others, Mr. Justice M. S. H. Quraishi (now a Judge of Supreme Court) observed :- "The question, therefore, arises if when the law has barred an appeal or other remedy from an interlocutory order, should the party be permitted to circumvent that law by recourse to the extraordinary jurisdiction of this Court. The question has by now been settled by a number of authorities following upon the decision of the Supreme Court in Ibrahim v. Muhammad Hussain P L U 1975 SC 457, in which the Supreme Court had held that an order passed under section 13(6) of Ordinance (VI of 1959) was not appealable. Recourse, thereafter, was made by parties to the constitutional jurisdiction against such order. A Division Bench of this Court in Mi.Hammad Saeed v.
16. Mst. Saratul Fatima PLD 1978 Lah. 1459 held that :- "It therefore, follows that what the Legislature held to be an interlocutory order not by itself fit to be appealable, should not by such a device be held fit enough to attract the more important, and at a higher level, the constitutional jurisdiction. Any contention or practice to the contrary would defeat and deflect the legislative intent, which has been disapproved in Mumtaz Hussain Bhutta v. Chief Administrator, Auqaf etc. 1976 SCMR 450."
17. ' In Muslim Commercial Bank Ltd. v. Sh. Ljaz Nisar and 2 others, High Court observed : "The petitioner applied before the Special Court for leave to defend the suit. The leave was granted subject to the condition that the petitioner should deposit into the Court the entire suit amount within one month. Through this writ petition, the petitioner has challenged the imposition of the said condition. It is not disputed that under rule 3(2) of Order XXXVI1 the Special Court could while, granting leave to defend the suit, impose the impugned condition. It is thus not a case where the order of the Special Court suffers from any error of jurisdiction. The grievance of the petitioner is that it is a banking institution and it cannot allow such a large amount as is involved in this suit to be tied up in an unproductive deposit and so long as the amount remains in the Court it will not bring any return for the bank. It is further stated that in case the suit is ultimately decreed, it will not be difficult for the Industrial Development Bank of Pakistan to effect the recovery of the suit amount.
3. I do not think it is a fit case for interference in writ jurisdiction by this Court particularly when the order made by the learned special Court is with jurisdiction and well within its discretion. The petitioner; if so advised, can move the Special Court to place the amount in a Bank where it earns interest during the pendency of the suit. With these observations, this writ petition is dismissed in limine."
18. ' In Messrs Sullman Mahmood Cotton Ginners, Kabirwala and 2 others v. Special Judge, Banking-II and another, this Court is paras. 9 and 10 of the report observed "9. It is, thus, clear from the legal position noticed above, that the Constitution jurisdiction of the superior Courts cannot be invoked where it would have the effect of defeating or deflecting the legislative intent. The Banking Companies (Recovery of Loans) Ordinance, 1919 has been promulgated for securing and repayment of loans of Banking Companies through Special Courts to be established under the Ordinance. Although in the exercise of civil jurisdiction, the special Courts are required to follow the summary procedure provided for under Order XXXVII, C. P. C.
19. (section 7(2) of the Ordinance), provisions relating to appeal, revision and review as contained in the Code of Procedure, 1908 had not been made applicable to orders and judgments passed by such Courts under the Ordinance, Section 11 of the Ordinance provides that subject to the provisions for appeal in section 12, any order or judgment passed by a Special Court shall not be called in question. Section 12 of the Ordinance makes provision for appeal against the order, judgment and decree passed by a special Court to the High Court but no appeal is competent against an interlocutory order which does not dispose of the entire case before the special Court. It may be noticed that all appeals which were pending before the Supreme Court or the High Court at the commencement of the Ordinance against the interlocutory order which did not dispose of the entire case, stood transferred to the Special Court by virtue of section 13(a) of the Ordinance. It is clear that the object of the Legislature to take away the right of appeal in case of interlocutory orders is to ensure quick disposal of cases by the Special Court. This object cannot be defeated by circumventing the provisions of the Ordinance by invoking the constitutional jurisdiction of the High Court which is available only where no adequate and efficacious remedy is provided by law to the aggrieved persons. As noticed above, an appeal has been provided against the final order, judgment and decree passed by the Special Court under section 12 of the Ordinance. It, therefore, cannot be said that no adequate or efficacious remedy is provided under the Ordinance to the persons aggrieved by the final orders, judgment and decree which may be passed by the Special Court. The question of interference with interlocutory orders passed by the Special Court, in exercise of writ jurisdiction by the High Court has also been considered in a case recently decided by this Court which is reported as International Food Centre v. United Bank. In that case also, the petitioner had challenged the order of Special Court whereby he was allowed leave to defend the suit subject to the payment of Rs, 2 lacs in Court within a period of two months or furnishing Bank Guarantee for the sum and to furnish ordinary security in respect of balance of the suit amount. It was held that interference with the interlocutory order by recourse to constitutional jurisdiction was bound to delay the proceedings before the special Court and would also defeat and deflect the object of the Legislature. The writ petition was accordingly dismissed by the Court.
10. Learned counsel for the petitioners has drawn my attention to two judgments delivered by my learned brother Muhammad Munir Khan, J. In Writ Petition No, 670/81 on 25-10-1981 and Writ Petition No, 574/81 on 18-11-1981. In both these cases, interlocutory orders passed by the Special Judge Banking (II), Lahore granting leave to the petitioners to defend the suit filed against them subject to payment of the amount in suits in Court were struck down as being illegal and without jurisdiction in exercise of constitutional jurisdiction. Learned counsel for the petitioner has particularly referred to the following observations made in these cases :- "I am of the considered opinion that if this Court is satisfied that an interlocutory order suffers from infirmities affecting the jurisdiction of a Court or tribunal, then it would be failing in its constitutional duties to refuse to interfere and allow the Court or tribunal to pass illegal orders under the cover of Special Law because once the Court comes to a conclusion that the Court or tribunal has exceeded jurisdiction by flouting the provisions of relevant law, has violated the principles governing the exercise of judicial discretion, acted arbitrarily, passed an illegal and unfair order without applying its mind, it would, then, be the duty of this Court while sitting in its constitutional duties to strike down such order regardless of the fact that the interference may defeat the legislative intent i,e, a speedy and efficacious method for the recovery of loans advanced by the Bank.
20. ' With utmost respect to my learned brother Muhammad Munir Khan, J., I find myself unable to subscribe to the views expressed above in view of the pronouncement of the Supreme Court and the High Court in the cases noticed above that the superior Courts would not interfere with the interlocutory order in the exercise of the constitutional jurisdiction if such interference would defeat or deflect the intent of the Legislature. In my humble view, the interlocutory orders passed by a Special Court under the provisions of the Banking Companies (Recovery of Loans) Ordinance, 1979, cannot be interfered with by recourse to constitutional jurisdiction of this Court Particularly when it has specifically been provided in the Ordinance that no appeal shall lie against such order unless it disposes of the entire case before the Special Court. A conditional order allowing leave to the defendant to defend the suit cannot be considered as an order which disposes of the entire case before a Special Court and as such it is not appealable. Obviously, such order cannot be allowed to be questioned in exercise of the constitutional jurisdiction of this Court as it would defeat the legislative intent of expeditious disposal of cases by the Special Court set up under the Banking Companies (Recovery of Loans) Ordinance, 1979."
21. ' In Ch. Automobile Auto Store and others v. United Bank Ltd., permission to defend the civil suit was granted subject to deposit of the amount. Deposit was not made and the suit was decreed. First appeal was dismissed in limine by the High Court. Leave to appeal was refused by the Supreme Court of Pakistan. Supreme Court observed :- "As regards the severity of the condition imposed by the trial Court in granting leave to defend the matter falls within the discretion of that Court and considering the circumstances of the case we are satisfied that no illegality in exercise of such discretion has been committed."
22. ' Rule of law laid down in Ch. Automobile Auto Store and others v. United Bank Ltd., was reiterated by the Supreme Court in Sh, Abdul Maid v.United Bank Ltd. Lahore High Court in several writ petitions has taken the view that the question relating to grant of permission conditional or unconditional is in the discretion of the Court and was not amenable to judicial review in constitutional jurisdiction.
23. Following the rule of law laid down in Ibrahim v. Muhammad Hussain (1), this Court in Muhammad Sneed v. Mst. Saratul Fatima (2), observed "It therefore, follows that what the Legislature held to be an interlocutory order not by itself fit to be appealable, should not by such a device be held fit enough to attract the more important, and at a higher level, the constitutional jurisdiction. Any contention or practice to the contrary would defeat and deflect the legislative intent, which has been disapproved in Mumtaz Hussain Bhutto v. Chief Administrator Auqaf etc. 1976 SCMR 450."
24. ' I am, therefore, of the firm opinion that the interlocutory order passed by Special Court during the trial of the suit unamenable to appeal/revision, if allowed to be brought under challenge by recourse to extraordinary jurisdiction of the High Court will seriously defeat and deflect clear B legislative intent discernible from the provisions of Ordinance. There is yet another important feature of this case which cannot be lost sight of. Civil suit has been transferred to High Court to be heard and tried in exercise of its original civil jurisdiction. Review petition also awaits adjudication by the High Court. All the points now being raised in the constitutional petition can well be raised In support of the review petition before the learned Judge of the High Court hearing the suit. On this also the petitioner cannot be permitted to avail of remedy in constitutional jurisdiction from the High Court. The petitioners can press for early hearing of the review petition by taking appropriate steps in that direction. Writ petition cannot be kept pending to suit the convenience of the defendants/petitioners. For all that has been stated above, the writ petition has no merit, fails and is dismissed. However, with the agreement of learned counsel appearing for the Bank, operation of order regarding deposit of the amount sued shall remain suspended for a period of 30 days so as to enable the petitioners to obtain appropriate order on their review petition.
(1) PLD 1975 SC 457 (2) PLD 1978 Lab. 1459